CONSEQUENTIAL LOSS Meaning and
Definition
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Consequential loss refers to the financial or economic harm suffered by an individual, organization, or entity as a result of a particular event or incident. This type of loss is considered as an indirect consequence or a follow-up effect of the event rather than being directly caused by it.
In insurance, consequential loss represents the damages or losses that occur as a consequence of a covered event or peril. It typically encompasses financial losses resulting from disruptions in normal business operations, such as interruptions in the supply chain, loss of profit, increased expenses, or damage to reputation. Consequential losses are not usually covered under standard insurance policies, and therefore, additional coverage, such as business interruption insurance, may be necessary.
Moreover, contractual agreements often include clauses that outline the liability for consequential loss. These clauses establish the parties' responsibility for any losses arising due to the breach of contract or failure to meet specific obligations. The purpose of including these provisions is to ensure that parties are held accountable and provide compensation for the indirect damages incurred by the other party.
Overall, consequential loss refers to the indirect financial or economic consequences suffered due to a particular event or breach, often requiring specific insurance coverage or inclusion of contractual provisions for liability and compensation. It underscores the significance of assessing and mitigating potential indirect consequences when assessing risk or entering into contractual agreements.
Common Misspellings for CONSEQUENTIAL LOSS
- xonsequential loss
- vonsequential loss
- fonsequential loss
- donsequential loss
- cinsequential loss
- cknsequential loss
- clnsequential loss
- cpnsequential loss
- c0nsequential loss
- c9nsequential loss
- cobsequential loss
- comsequential loss
- cojsequential loss
- cohsequential loss
- conaequential loss
- conzequential loss
- conxequential loss
- condequential loss
- coneequential loss
- conwequential loss
Etymology of CONSEQUENTIAL LOSS
The word "consequential" is derived from the Latin word "consequens", which is the present participle of the verb "consequi", meaning "to follow" or "to result from". "Consequens" evolved into the Middle English term "consequent", which came to be used as an adjective describing something that follows as a result or consequence of something else.
The word "loss", on the other hand, originated from the Old English word "los", which referred to the act of losing or being deprived of something.
Therefore, the term "consequential loss" refers to a loss or damage that follows as a result or consequence of a particular event or action.
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